A) only 50,000 households are surveyed
B) it is only a "basket" of goods that is measured
C) the items in the "basket" are only changed every 10 years
D) the value of "home production" is not included
E) we "double count" investment spending

In 2005 Eagle Computers produced a computer which was delivered to the
company's retail outlet in November of 2005. The computer was sold to a
customer in March, 2006. This computer is counted as:

A) consumption in 2005 and as disinvestment in 2006.
B) disinvestment in 2005 and consumption in 2006.
C) investment in 2005 and as consumption and disinvestment in 2006.
D) disinvestment in 2005 and as investment in 2006.
E) GDP in both 2005 and 2006.

The phase of the business cycle in which real domestic output decreases is called:

A) the peak
B) a recovery
C) a recession
D) the trough
E) the expansion

Fred Flugelman quit work to go back to school and get a Master's Degree in Engineering. After graduation he is only able to find part time work at a McDonalds for the first two years. He then finds a full time job once the economy picks up. During his two years at McDonalds: